Torys foresees more midmarket take-privates in 2009, reports The Deal

Torys Sees More Midmarket Take-Privates in 2009

Last year may have been bad for dealmakers, but 2009 is a new year with new opportunities.

While the overall economic news remains dour, there are indications, says Torys in its Top 10 Trends for 2009 special bulletin, that the North American buyout market—especially take-private transactions—may recover in 2009 as private equity investors take advantage of low equity prices to make deals.

The market will favor midmarket take-privates, as credit constraints may make big buyouts difficult. The credit markets will also favor M&A buyers who have loaded up in cash: "The shortage of credit will favour strategic buyers with strong balance sheets and sovereign wealth funds with greater access to financing," says the bulletin. "Private equity will lean toward mid-market going-private transactions that contain more equity than in the past."